|
The following are the summarized Balance sheet of H Ltd and its
subsidiary S Ltd as on 31.12.08 |
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|
Liabilities |
H Ltd |
S Ltd |
Assets |
H Ltd |
S Ltd |
|
Ordinary shares of Rs. 10 each |
5,00,000 |
1,00,000 |
Fixed assets |
2,00,000 |
90,000 |
|
General reserves |
10,000 |
40,000 |
Stock |
90,000 |
30,000 |
|
Creditors |
20,000 |
30,000 |
Debtors |
40,000 |
30,000 |
|
Bills payable |
Nil |
5,000 |
Bills receivable |
5,000 |
Nil |
|
Bank balance |
1,15,000 |
25,000 |
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|
7,500 shares in B Ltd at cost |
80,000 |
Nil |
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|
5,30,000 |
1,75,000 |
5,30,000 |
1,75,000 |
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H Lad acquired shares in S Lid on 1.1.08 when S ltd had Rs. 10,000 in
general reserves, No dividend was declared by S ltd in 2008 All Rills
receivable of H Ltd are drawn on S ltd. You are required to prepare a
Consolidated Balance sheet as on 31.12.2008.
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Solution |
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Consolidated Balnace sheet (As per Revised Schedule VI) |
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|
Equity and Liabilities |
No. |
Amount |
|
I. Shareholders' Funds |
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|
Share capital |
1 |
5,00,000 |
|
Reserves and Surplus |
2 |
35,000 |
|
II. Minority Interest (Ref. Note 4) |
-- |
35,000 |
|
III. Non Current Liabilities |
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|
Long tern borrowings |
3 |
Nil |
|
IV. Current Liabilities |
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|
Short term borrowings |
4 |
Nil |
|
Trade payables |
5 |
50,000 |
|
Short term provisions |
6 |
Nil |
|
Other current liabilities |
7 |
Nil |
|
Total (I + II + III + IV) |
6,20,000 |
|
|
Assets |
No. |
Amount |
|
I. Non - Current Assets: |
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|
Tangible assets |
8 |
2,90,000 |
|
Intangible assets |
9 |
Nil |
|
Non - current investments |
10 |
Nil |
|
II. Current Assets: |
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|
Trade receivables |
11 |
70,000 |
|
Short term loans & Advances |
12 |
Nil |
|
Other current assets |
13 |
Nil |
|
Closing stock |
14 |
1,20,000 |
|
Cash and cash equivalent |
15 |
1,40,000 |
|
Total (I + II) |
6,20,000 |
|
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Notes to Accounts on Balance sheet |
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|
No |
Particulars |
Amount |
|
1 |
Share Capital |
5,00,000 |
|
2 |
Reserves And Surplus: |
|
|
General reserves |
10,000 |
|
|
Revenue profits of H Ltd |
22,500 |
|
|
Capital reserves (Trans. from Note: 5) |
2,500 |
|
|
Total |
35,000 |
|
|
3 |
Long Term Borrowings |
Nil |
|
4 |
Short Term Borrowings |
Nil |
|
5 |
Trade payable |
|
|
Creditors(30,000 + 20,000) |
50,000 |
|
|
Bills payable less Mutual owning (5,000 - 5,000) |
Nil |
|
|
50,000 |
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|
6 |
Short term provisions |
Nil |
|
7 |
Other current liabilities |
Nil |
|
8 |
Tangible Assets : Sundry Assets (2,00,000 + 90,000) |
2,90,000 |
|
9 |
Intangible Assets |
Nil |
|
10 |
Non - Current Investments |
Nil |
|
11 |
Trade Receivables |
|
|
Debtors(40,000 + 30,000) |
70,000 |
|
|
Bills receivable less mutual owing (5,000 - 5,000) |
Nil |
|
|
70,000 |
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|
12 |
Short Term Loans & Advances |
Nil |
|
13 |
Other Current Assets |
Nil |
|
14 |
Closing Stock Or Inventory : Stock (90,000 + 30,000) |
1,20,000 |
|
15 |
Cash and cash equivalent : Bank balance (1,15,000 + 25,000) |
1,40,000 |
|
Working Note |
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1: Calculation of share ratio |
|
|
Number of shares in S Ltd = Share capital amount in S Ltd. / Face
value of equity shares |
|
|
Rs. 1,00,000 / Rs. 10 = 10,000 equity shares |
|
|
H Ltd : Minority Interest = 76,500 shares: 2,500 shares = 3 : 1 |
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|
2. Calculation of capital profits |
|
|
Reserves balance given in the adjustments = |
10,000 |
|
Total capital profits = 10,000 |
|
|
H Ltd = 10,000 x 3/4 |
Rs. 7,500 |
|
Minority interest = 10,000 x 1/4 |
Rs. 2,500 |
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3. Calculation of Revenue profits |
|
|
General Reserves and P/L A/c of S Ltd which is given B/s liability
side = |
40,000 |
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Less: Total capital profits = |
10,000 |
|
Total revenue profits |
30,000 |
|
H ltd (transfer to Note No: 2) = 30,000 x 3/4 = |
Rs. 22,500 |
|
Minority interest = 30,000 x 1/4 = |
Rs. 7,500 |
|
4,Minority interest |
|
|
Nominal paid up share capital amount (2,500 shares x 10) = |
25,000 |
|
Capital profits = |
2,500 |
|
Revenue profits = |
7,500 |
|
Total minority interest (transfer to liabilities side) = |
35,000 |
|
5. Cost of Control: (H Ltd) |
|
|
Nominal paid up share capital amount (7,500 x 10) = |
75,000 |
|
Capital profits = 7,500 = |
82,500 |
|
Less: Investment of shares in S Ltd = |
80,000 |
|
(+) Capital reserves (Transfer to Note No: 2) = |
2,500 |
